Heinz to cut worldwide workforce by 2,700
Food giant Heinz announced today it would reduce its workforce by 2,700 as part of plans to pull operations at 15 factories worldwide.
The company did not give a breakdown of the cuts, but a spokesman said it was likely to involve the cutting of 600 jobs and four factories in Europe.
Heinz is already involved in consultations over a controversial move to close its HP Sauce plant at Aston, Birmingham, and transfer production to Holland.
The Pittsburgh-based company, best known for its ketchup and baked beans, has some 3,500 workers at plants in the UK and Ireland.
It said the efficiency drive announced today would involve 8% of its global workforce, and would be mainly achieved through its exit from 15 factories during the current financial year. A further five plants could be removed from its books in the following year, the company added.
The plan emerged as Heinz said fourth-quarter profits for the three months to May 3 dropped 19% on a year earlier, to $167.9m (€131m). Revenues grew by nearly 8% to $2.4bn (€1.9bn).
Heinz is facing pressure from billionaire investor Nelson Peltz to improve shareholder returns.
Earlier in the month Mr Peltz and his Trian Group outlined a plan, which was rejected by Heinz, to improve profit by cutting costs and reducing incentives to retailers.
Heinz Europe’s sales increased 2.6% in the quarter, with volumes up 6.5%, following increases in UK soup and ketchup and in Italian baby food. The company added that price cuts decreased sales by 2.6%, although this was partially offset by increased pricing on Heinz beans.
